business news in context, analysis with attitude

Senator Joni Ernst (R-Iowa) has introduced a bill in the US Senate proposing that "federal income taxes would be suspended for essential workers up to an annual income cap set at the highest level of pay for an enlisted person in the U.S. Armed Forces. Additionally, the bill would provide suspension of federal payroll taxes for essential workers who earn up to $50,000 annually."

"Our essential workers have risen to the challenge and continued in their daily jobs – to care for and protect Iowans, to produce and deliver food and essential goods, and to uphold our nation’s critical infrastructure throughout this pandemic,” Ernst said in a statement. “These front line workers - our nurses, truck drivers, and grocery store workers, child care providers, and so many others - have kept life going and our supply chains intact. These men and women are putting the interests of their fellow Americans ahead of their own. Each and every morning they wake up and go to work, and they should be rewarded for their selfless service."

The bill is being endorsed by FMI - The Food Industry Association, the National Grocers Association (NGA), among other trade associations.

In Iowa, the Dispatch Argus points out that the Congress only is scheduled to work for less than a month before going out on a summer recess.

KC's View:

It is worth pointing out - with no judgement one way or the other - that Ernst is engaged in a tough re-election battle.  I suspect that telling your state's "essential" workers that they're going to be excused from paying federal taxes for a period of time isn't just a good idea, but also good politics.